Vendor or Vulnerability? How to Know the Difference (And What to Do About It)

Tuesday, October 21, 2025

When most small businesses think about cybersecurity, they think about passwords, phishing, or keeping their Wi-Fi secure. But one of the biggest risks to your business might come from someone you already trust, your vendors.

From your payment processor and payroll provider to your marketing platforms and IT contractors, every service you use connects to your systems in some way. And that connection, while convenient, can also be a hidden doorway for attackers.

You don’t need to panic, but you do need visibility. Because when it comes to cybersecurity, trust without verification can be costly.

The Rise of the Supply Chain Attack

In the past few years, hackers have started targeting small businesses not directly, but through their vendors. It’s called a supply chain attack, and it’s become one of the fastest-growing types of cyber incidents.

Here’s how it works:
Instead of trying to break into 500 small businesses individually, attackers breach one widely used software provider, and then use that access to reach thousands of customer accounts downstream.

We’ve seen it happen across industries:

An accounting platform that leaked customer data.
A marketing app that stored passwords in plain text.
A managed IT provider whose credentials were stolen and used to access their clients’ systems.

In fact, over 60% of data breaches in 2025 involved a third-party vendor.

Small businesses are especially vulnerable because they rely on many online tools; but rarely have time to evaluate each one’s security practices. Most assume vendors have it handled. Unfortunately, that’s not always the case.

Signs Your Vendor Might Be a Vulnerability

Not every vendor relationship is risky, but there are red flags worth watching for.
If any of these sound familiar, it might be time to take a closer look:

The vendor doesn’t require two-factor authentication for your account.
They store or process customer data but haven’t shared a clear security policy.
Their app or platform hasn’t been updated in a long time.
Former employees or contractors still have access to shared accounts.
You’ve never reviewed what permissions they actually have.

If you’re not sure what data your vendors can see, they probably see too much.

Even well-meaning partners can become an attack vector if they lack basic protections. The key isn’t cutting vendors off; it’s gaining visibility into how they interact with your systems.

How to Protect Your Business Without Adding More Work

You don’t need a dedicated IT department to manage vendor security. With the right tools, you can keep your relationships strong and your data safe.
Here’s how to start — and how Lockwell helps along the way:

Step 1: Make a List

Write down every app, service, and vendor that connects to your business. Include payroll, invoicing, marketing tools, CRM, and file storage platforms.
Most small businesses discover they have more than 20, sometimes 50 or more, connected vendors.

How Lockwell helps:
Lockwell automatically inventories your connected accounts and vendors, so you can see who’s accessing what; all in one dashboard.

Step 2: Review Access

Ask:

What data does each vendor access?
Which accounts or employees are connected?
Do they use secure sign-in methods (like 2FA)?

You might be surprised to find inactive users or services that still have access long after you stopped using them.

How Lockwell helps:
Lockwell tracks user and vendor access, flags high-risk connections, and helps you close them safely. No technical expertise required.

Step 3: Audit & Monitor

Even trusted vendors can make mistakes or experience breaches. That’s why ongoing monitoring matters as much as initial vetting.

How Lockwell helps:
Lockwell’s AI-driven monitoring automatically checks your connected vendors for issues like:

Expired security certificates
Data exposure alerts
Misconfigured permissions
When a problem arises, Elle notifies you immediately and walks you through how to fix it.

A Real-World Example: When “Trusted” Turned Risky

Imagine this: a small design studio uses a popular invoicing platform to bill clients and store payment details. It is a tool they rely on every day because it is fast, convenient, and widely used.

Now, picture what could happen if that platform experiences a security breach. Suddenly, customer information from hundreds of small businesses, including theirs, could be exposed. This would not happen because the studio did something wrong, but because they did not realize how much data their vendor was responsible for protecting.

This type of situation is becoming more common every year. When one vendor is compromised, the effects can spread quickly across many businesses.

If the studio had been using Lockwell, they would have received an alert as soon as the vendor’s security issue was detected, along with clear, guided steps to protect their data and communicate with clients. What could have been a crisis would instead become a calm, informed response.

Building Vendor Trust the Smart Way

Good cybersecurity isn’t about paranoia, it’s about partnership. You don’t need to distrust your vendors; you just need clarity around their access and security practices.

Vendor management isn’t about control, it’s about visibility. And visibility builds trust.

By managing vendor risk proactively, you protect your business, your customers, and your reputation — all while strengthening the partnerships that help your business grow.